Was driving to work running late got about 15 miles from home an I hear an odd sound. Started to act as if I was sounds of gas, then there was a loud pop as if it backfired and sparks flew out the back. Got out to check what was wrong and rear axle was smoking

It likely ran low on gear oil and overheated. Check it out closely, looking for signs of overheating. I suspect one or more bearings seized. Pull the differential cover and go from there. Once you repair the damage, refill with Mobil 1 Synthetic Gear Lubricant--it offers a much greater margin of safety.